Monopolies and CONs

NEVADA JOINED THE STATES TO FULLY LEGALIZE marijuana at the state level and it’s already seeing a problem come up, one that is very old and common–the monopoly.

From the LasVegasReviewJournal:

“A Carson City district court judge … refused to dismiss a lawsuit brought by liquor distributors against the Department of Taxation over the distribution of recreational marijuana to pot dispensaries…. One of those disputes involves the Department of Taxation’s intervention in a licensing process by liquor distributors in Clark County who were seeking to participate in the distribution process.

The decision could delay the start of recreational marijuana sales originally set for July 1 via the existing medical marijuana dispensaries operating throughout Nevada.

Issue is whether liquor distributors have the first right to distribute marijuana from grow facilities to the dispensaries.”

According to the alcohol distributors the law clearly stipulates they get first shot and a temporary restraining order was issued against marijuana distributors from a lawsuit brought on by the Independent Alcohol Distributors of Nevada.

It should be mentioned, that the tax agency had concerns of lack of interest by the alcohol distributors in the marijuana business–spokeswoman for the Department of Taxation, Stephanie Klapstein stated there was only one liquor wholesaler who applied for a license at the time the restraining order was issued, and it came the morning of the lawsuit–the attorney for the liquor distributors, Kevin Benson, claims five have applied for the licenses. It would be difficult to not see this as suspicious. But let’s leave Nevada for a moment and go to Iowa.

From Reason.com:

“In Cedar Rapids, Iowa, there is a fully outfitted outpatient surgical center that could be used to treat patients with eye problems and improve their vision.

It sits empty, unused, a monument to government imposed artificial restrictions on the supply of medical care.

The prohibition has nothing to do with Dr. Lee Birchansky, who owns the surgical center and the doctor’s office next door. He’s allowed to operate on patients at nearby hospitals, but he can’t do those same surgeries in the facilities that he owns.”

So what’s the problem? The doctor has been the victim of a CON. No, not a scam artist, but a state sanctioned scam. The con in this case is Certificate of Need, so literally a CON. Essentially it’s a license that some states require the business to obtain demonstrating the need for the business or for the industry to expand in the area. It’s used by large companies to keep out competitors. “It is ridiculous that I have an outpatient surgery center that is … ready to go, but I have been denied a certificate of need four times because established hospitals do not want competition,” said Birchansky.

In order to reopen Birchansky would need to obtain the CON from the Department of Public Health, which he would have to file another application and a $21,000 fee.

All is not lost for Dr. Birchansky he has help. On Birchansky’s side is the Institute for Justice, a law firm noted for challenging such laws. “Patients and Doctors–not the government–are in the best position to decide what medical services are needed,” said Joshua House of the Institute. Also joining Birchansky in the right is Governor Terry Bradstad of Iowa, who fights to reform CON laws in the state. As for the marijuana distributors of Nevada, right now it appears they are stuck in legislative limbo. For now, the medical marijuana dispensaries will be serving as recreational distributors while all this gets sorted out. When going up against the monopolies, even a single victory is a great one and in time, maybe the Nevada Department of Taxation will see through the smoke.

R.C. Seely is the founder of americanuslibertae.com and ALTV. His latest book, Victims of White Male: Victim Culture Victimizes Society is available on Amazon.